the intersection of sports, economics, management, and strategy

Do Super Sized NFL Quarterback Contracts Lead to Super Bowls?

Yesterday I detailed how Colin Kaepernick’s extension seems to be a pretty great deal for both sides. Kaepernick will be among the top paid handful of players in the league so long as he or the team performs at a truly elite level. The 49ers will recoup several million dollars should that fail to happen. This contract ought to anchor the 49ers talented roster for years to come, possibly into the next decade. But will Kaepernick’s contract create a dynasty on par with that of Joe Montana’s four Super Bowl championships? Probably not.

Whether Kaepernick’s yearly cap hits end up being closer to $16, $18, or $20 million remains to be seen, but no matter what that money cannot go to anyone else on the team. Under Jim Harbaugh, who has coached in three NFC championship games in his three years with the team, the 49ers have yet to pay a premium for their quarterback services.

Season

Starting QB

Cap Hit

% of Cap

League Average

% of Cap

2011

Alex Smith

$4,900,000

4.08%

$6,478,783

5.40%

2012

Alex Smith

$9,250,000

7.67%

$8,257,642

6.85%

2012

Colin Kaepernick

$1,164,613

0.97%

$8,257,642

6.85%

2013

Colin Kaepernick

$1,397,535

1.14%

$10,293,699

8.37%

Under Harbaugh the 49ers had one season when Alex Smith cost the same as a league-average starter1, and the other two years the 49ers’ starting quarterback cost them very little relative to the rest of the league. Getting quality quarterback play for such low cap hits gave the 49ers that much more money to add and retain talent elsewhere. And in 2014, Kaepernick’s cap hit remains a scant $3.767 million. But after that?

Year

Cap Hit

2014

$3,767,444

2015

$17,265,753

2016

$18,765,753

2017

$21,365,753

2018

$21,865,753

2019

$21,200,000

2020

$23,400,000

Over the six-year extension (2015-2020), Kaepernick’s average cap hit is $20.644 million. Again, that could fall a few million in some seasons, depending on his and the team’s performance, but it will be at least $16-$18 million every year, if not more. It is not known what the salary cap will be in those years,2 but since 19993 the cap has, on average, increased each year by 7.15 percent. This is not, by any means, a perfect predictor of what the cap increases will look like going forward, but it may be close.4 If the cap increases roughly as it has in the past,5 what will Kaepernick’s contract amount to as a percentage of team spending?

Season

Kaepernick’s Cap Hit

(Overly Simplistic) Projected Salary Cap

Percent of Salary Cap

2015

$17,265,753

$142,509,500

12.12%

2016

$18,765,753

$152,698,929

12.29%

2017

$21,365,753

$163,616,903

13.06%

2018

$21,865,753

$175,315,511

12.47%

2019

$21,200,000

$187,850,570

11.29%

2020

$23,400,000

$201,281,886

11.63%

Jim Harbaugh is a terrific football coach, but he has never had his team spend such a high share of its budget on the starting quarterback. General manager Trent Baalke and Paraag Marathe and Co. have never had less money to spend on the other 45 players who will suit up on game day. Quarterback is the most important position, but there are 10 other guys on offense, and 11 other guys on defense, and three unique guys on special teams, too, and some backups, and they all matter to some degree. Even if Kaepernick’s contract diminishes some, and the cap increases more than the 7.15 percent average annual rate of the past, the 49ers will still likely spend 10 percent of their available funds on Kaepernick every season.

Teams spending so much on their quarterbacks can win the Super Bowl. But it is not easy.

Year

Super Bowl Winning QB

% of Team’s Salary Cap

Super Bowl Losing QB

% of Team’s Salary Cap

1999

Kurt Warner

1.31%

Steve McNair

10.60%

2000

Trent Dilfer

N/A

Kerry Collins

N/A

2001

Tom Brady

0.46%

Kurt Warner

3.46%

2002

Brad Johnson

9.56%

Rich Gannon

5.22%

2003

Tom Brady

4.42%

Jake Delhomme

2.37%

2004

Tom Brady

6.28%

Donovan McNabb

9.69%

2005

Ben Roethlisberger

4.94%

Matt Hasselbeck

7.72%

2006

Peyton Manning

8.38%

Rex Grossman

1.50%

2007

Eli Manning

10.75%

Tom Brady

6.73%

2008

Ben Roethlisberger

7.11%

Kurt Warner

5.17%

2009

Drew Brees

8.42%

Peyton Manning

18.88%

2010

Aaron Rodgers

N/A

Ben Roethlisberger

N/A

2011

Eli Manning

11.75%

Tom Brady

10.79%

2012

Joe Flacco

6.63%

Colin Kaepernick

0.97%

2013

Russell Wilson

0.55%

Peyton Manning

14.23%

Reliable data for the salaries of Dilfer and Collins back in 2000 was not available, and in 2010 there was no salary cap.6 But in the other 13 seasons since 1999, 26 unique teams made the super bowl. Only six of those 26 teams paid their quarterback more than 10 percent of the salary cap: the 1999 Titans (McNair), the 2007 Giants (E. Manning), the 2009 Colts (P. Manning), the 2011 Giants (E. Manning), the 2011 Patriots (Brady), and the 2013 Broncos (P. Manning). (Whole lotta’ Mannings comin’ at ya.) Only a small minority of recent Super Bowl teams had crossed the 10 percent threshold with their starting quarterbacks. What does it all mean? Are the 49ers’ Super Bowl dreams dashed?

Perhaps not, at least not completely. Five of those six teams come from 2007 or later, with four coming from the last eight teams to play in the Super Bowl. Fans keep hearing it, and not without reason: the game really has changed significantly, even since I started watching football 15 years ago. More than ever, it is a passing league. Quarterback salaries are, literally and figuratively, on the rise, not only in absolute terms but relative to other positions. That the 49ers will spend more than 10 percent of their budget on their starting quarterback every year may not be ideal, but it makes a lot more sense now than it would have 15 or even 10 years ago. And this is not just any starting quarterback we have been talking about; it’s Colin Kaepernick.

Nonetheless, with two more years on his contract, Russell Wilson remains the envy of every general manager in the league. Not to overreact, but at what point do we start discussing rather Wilson is the greatest draft pick of all time?7 If the Seahawks win the Super Bowl again next year? Peyton Manning is still probably better than Wilson, but his share of the Broncos’ cap when they met in the Super Bowl last season was nearly 30 times larger than Wilson’s. The Seahawks had a lot more money to spend elsewhere. We all saw what happened.

The 49ers, meanwhile, have a powerful opportunity this year, with Kaepernick only taking up 2.8 percent of their funds. After that, the road gets tougher, with every draft pick, every low-budget signing becoming that much more important. Hopefully the 49ers can pull out a Super Bowl win in the next seven years, maybe two with a bit of luck. But do not expect an NFC championship game appearance every year, Harbaugh or no. It’s just too darned expensive to keep getting there.

The average cap hits of the top 25 paid quarterbacks in each year, according to OvertheCap.com. I use the top 25 because though there are 32 teams and therefore, technically, at least 32 starters, the dregs of the league tend to see high turnover rates and are not really “true” starters, due to poor play, repeated injuries, or what have you. ↩

Kaepernick’s cap hits escalate every season, as the salary cap is expected to, so Kaepernick’s percent of the whole cap will hopefully change little year to year, even as the 49ers pay him millions more. ↩

1999 is something of an arbitrary end point; the modern salary cap really began in 1994. For some other findings in this piece I didn’t find much data before 1999, but most of the data after 1999 is available, so I am keeping it consistent. Something of a nice coincidence, as the Titans-Rams Super Bowl following the 1999 season (played in 2000) is the first one I remember watching in its entirety. ↩

Most increases were five to six percent, with a couple outliers wherein the league drastically increased the amount of money teams can spend. Since the new collective bargaining agreement, the 2012 salary cap was 0.5 percent more than 2011’s, 2013 was 2 percent more than 2012’s, and now 2014’s is 8.13 percent more than 2013’s, so who really knows what the hell the league will do. ↩

Again, this is not guaranteed to happen. It is a very, very, very simplified estimate, not a concrete prediction. ↩

Yes, Tom Brady went in the 6th round. But Brady was not drafted to be who he is today; he was clearly a backup coming out of camp and fell into the Patriots’ lap as a great player when Bledsoe was injured. The Seahawks took Wilson in the third round with the intention of him competing to start from day one, and that is exactly what happened. Goodness, how they have reaped the rewards. ↩